Friday’s Mixed Data

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There was mixed data released on Friday.

The graphs below show that Personal Spending was up while Personal Income was down…this seems to be a re-occurring theme, as I last reported in my post of March 1st. Add to this the information from my post of March 7th, and it seems that the consumer is headed for disaster. How long it's sustainable is anybody's guess.

The graph below shows that the Core PCE Price Index was down. As noted on the graph, this is rumoured to be the Federal Reserve's favourite inflation measure…more on this in my post of January 25th

The graphs below show a decrease in the Chicago PMI, while Revised UoM Consumer Sentiment rose.

It would seem to me that the only thing the Fed cares about are unemployment and its own adopted formula of inflation measurement, as has been stated repeatedly in their "Dual Mandate" policy. As long as their "inflation" number stays below their targeted 2% range (with some "allowances" made along the way to achieve an acceptable level of unemployment), I doubt whether they will relax their inventive monetary easing tactics any time soon. However, if the U.S. does, in fact, enter into a recession by the middle of 2012, as noted in my post of March 27th, the markets may begin to react to negative data releases by then. Until then, I don't think they have much meaning.